Bitcoin and Beyond

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Life in Venezuela is unimaginable to me for reasons beyond that I have never been there. I cannot picture walking into a store with no food on the shelves. I cannot comprehend walking around with massive bags of cash in the murder capital of the world. I cannot imagine how my entire life savings can suddenly being worth next to nothing. The list of the unimaginable when it comes to life in Venezuela could go on forever, however that is not the objective of this post.

There is a point where it becomes abundantly clear, that sharing articles on Facebook, posting a new profile picture in support of your favorite “cause” or donating a dollar at the grocery checkout register when the clerk asks if you’d like to support [insert cause here], just isn’t going to cut it.

I’m not a wealthy person, a politically-connected humanitarian-activist, or anything of the like. I’m a regular guy who, probably much like yourself, is sick and tired of sitting on the sidelines hoping socialist regimes will fall, or hoping world leaders will take action and better times will come to those in the most need.

So what SHOULD you do? I really don’t know. What I do know is that we each have our own unique talents and abilities, that when set to purpose, have the ability to make change far greater than we could ever imagine. My talent, is taking complex practices, and teaching them in a way that anyone with the desire, can learn, understand and apply.

What I’m going to teach in this post is how to send remittances to Venezuela with Bitcoin in order to circumvent the capital controls of a socialist regime. Laymen terms, I’m going to teach you how to send money to your family in Venezuela with limited fees or government interference, ensuring that a dollar sent is a dollar received. Guess what? Your loved ones in Venezuela can then leave the house in more safety, without a backpack full of cash, because the money is going straight to their bank account.

You might be wondering:

· What the hell is Bitcoin?

· How do I get it?

· And more importantly, how do I get it to my family?

The goal of this guide is to answer each of those questions, in simple terms.

Bitcoin is a digital currency which can be sent anywhere in the world as easily as sending an email. It is not controlled by the government or other central authority, but is rather controlled by its users. There is a limited supply of Bitcoin that will ever be in circulation; 21 million to be exact. This property makes Bitcoin rare. You can think of Bitcoin as digital gold, except unlike gold, Bitcoin is easily transferable anywhere in the world, and is not easily taxed or controlled by governing authorities.

Buying, selling and storing Bitcoin can be confusing for non-technical users; so let me break so you can actually DO what everyone is talking about. This post is here to help. If you are ready to take action then let’s get started.

The graphical representation below outlines each of the steps you will be taking in order to

1. Get Bitcoin for a fair price,

2. send it to your family in Venezuela,

3. They can take that Bitcoin and convert it to Bolivars

4. and finally, withdraw those Bolivars to their local bank account.

Take a look at the process flow below, and then follow along as I walk through the details of each step that is called out in the flow.

Buying Bitcoin: Bitcoin is a digital currency which can be sent anywhere in the world as easily as sending an email. It is not controlled by the government or other central authority, but is rather controlled by its users. There is a limited supply of Bitcoin that will ever be in circulation; 21 million to be exact. This property makes Bitcoin rare. You can think of Bitcoin as digital gold, except unlike gold, Bitcoin is easily transferable anywhere in the world, and is not easily taxed or controlled by governing authorities. Buying, selling and storing Bitcoin can be confusing for non-technical users; so let me break it down. One of the most popular, my personal favorite sites to buy Bitcoin is www.coinbase.com, and is the site we will be referring to in the below images to walk through purchasing [1] and sending [2] from the process flow above. Alternatively, https://localbitcoins.com/ is a great site for direct person-to-person (P2P) trading of Bitcoin. You can even use https://coinatmradar.com/ to locate a Bitcoin ATM. Go ahead and create an account on Coinbase, and purchase the amount of Bitcoin you would like to send. Note: the website will show you the U.S. Dollar (USD) equivalent of Bitcoin you are purchasing. For a detailed guide to purchase your first Bitcoin, refer to this link: Coinbase Tutorial.

Sending Bitcoin: Before you send the Bitcoin you have purchased to Venezuela, the person on the receiving end, will need to register on the surbitcoin exchange website. Once registered, they will need to verify their identity and link their bank account information. This is necessary in order to process withdrawals to their bank account. Once they have verified their identity and entered bank account information, they will need to navigate to the deposits page. Here they will click the deposit Bitcoin button and copy the address as shown below. This long alpha numeric string of digits is called their Bitcoin “address.” You can consider this their Bitcoin bank account number, and you will need their account number in order to send them the Bitcoin you purchased on Coinbase.

Once you receive their Bitcoin address (account number), you can navigate to the Send/Request menu on your Coinbase account and enter their Bitcoin address as the recipient as shown below. [It is advised that you copy and paste their address number for the step as it is easy to make a mistake typing in their address manually.] Once you have entered their address information, select the amount that you would like to send and press “send funds.”

Exchanging Bitcoin for Bolivars: Once you have sent Bitcoin from Coinbase to the recipient’s Surbitcoin wallet address, they will see the balance in their account after a short while [allow an hour]. Once the Bitcoin is available, they can sell the Bitcoin for Bolivars by clicking sell [as shown below]. Note:while it is generally not recommended to leave Bitcoin on exchanges for longer than is necessary, the fact that the Bolivar is inflating so rapidly, I would recommend only exchanging what is needed and holding the excess in Bitcoin. The reason for this while the Bolivar may be worth significantly less in one week than it is worth today, while Bitcoin is more likely to hold its value.

You are all done! In my next post, I’ll be discussing how to buy food, medical supplies, toiletries and more transacting with Bitcoin alone.

I hope this post makes a positive impact on someone you care about. If you have any questions about the process above, or want to chat, contact me at wesdewayne@gmail.com via email or g-chat, or leave a comment below.

With the Italian referendum approaching on December 4, 2016, global markets are heating up with trepidation and Bitcoin is once again in the limelight as a potential safe-haven asset.

The referendum, if passed would in effect put more power in the hands of the government by streamlining power of the Senate. Spearheading the referendum is Italian Prime Minister Matteo Renzi, who has publicly vowed to step down from office if the referendum is unsuccessful. On the flip side, the anti-establishment Five Star Movement (MS5) have used Renzi’s pledge as a conduit to campaign against the referendum and against Renzi himself.

What does this mean for Bitcoin?

If MS5 runs a successful campaign and Renzi steps down, the result would put MS5 in position to grab power and further their agenda; another referendum to leave the European Union and exit the Euro. If successful, this could cause a flood of investors exiting the Euro and into other currencies/assets with Bitcoin being a strong candidate.

We’ve seen numerous instances where such movement has happened, the recent Brexit being the most notable. During the Brexit referendum to leave the EU, we saw favored results to remain. It wasn’t until the last few hours of voting, upon which the votes switched to favor leave and shocked the markets.

Brexit Results

Votes

%

Leave

17,410,742

51.89%

Remain

16,141,241

48.11%

Prior to the vote, we saw the market had priced in a remain sentiment. Upon signal that leave was probable, the markets swiftly reacted, and the Euro and Pound plummeted, while Bitcoin and Gold flourished. Take a look at the charts below from the night of the Brexit vote, June 23, 2016.

EURUSD, 30

BTCUSD, 30

The Italian referendum is having similar effects to the markets, however contrast to the Brexit sentiment prior to the vote, the Italian referendum is favored to fail after the latest polling results from November, 18 as depicted below.

A quick look at the EURUSD, 60 chart shows markets have already priced in the sentiment of a “No” prevailing, and a potential future exit from the EU spearheaded by MS5 (note that other factors are playing into the fall of the Euro, including imminent interest rate hike by the FED, loose monetary stance in the Eurozone, etc.).

Conversely, we are already seeing a positive movement in the BTCUSD, 60 chart indicating a positive sentiment in Bitcoin partially stemming from uncertainty in the future state of the Euro.

Trading strategy:

With markets priced for a failure of the referendum and potential increase in power of MS5 and potential future exit of the EU and abandonment of the Euro by Italy (a lot of “if’s” here), traders should watch the polls carefully on Sunday and react accordingly. If the referendum fails as predicted, Bitcoin could see an even greater influx of demand, potentially pushing the price even higher than what has already been priced in by the market. Conversely, if the referendum passes, we could see money move out of Bitcoin, and a price depression as investors regain certainty in the Euro. Traders should watch carefully as much of the country is still undecided and the vote could swing either way.

If you have any questions on this strategy or just want to chat, feel free to contact me at wesdewayne@gmail.com via email or g-chat. For those who have asked, I do most of my trading on Whaleclub where you can use Bitcoin to trade stocks, forex, crypto, and commodities up to 100x leverage. Get a deposit bonus when you join via my referral link (and a nice bonus for me as well): https://whaleclub.co/join/ekOFIO

In the wake of the demonetization of the 500 and 1000 Rupee notes as announced by the Indian Prime Minister Narenda Modi on November 8, 2016, in an attempt to crack down on the black money economy; rumors have spread like wildfire among Indian merchants that gold could be the next target of Modi’s wrath.

If the attack on cash wasn’t foreshadowing enough, an amendment bill, just introduced by Finance Minister Arun Jaitley, has called for a 50% tax on unaccounted deposits (black money) or 85% tax if caught.

India, a country which citizens have historically paid only 1% income tax, these changes have brought a serious crackdown to the underground economy in an attempt to thwart black money trade and increase the breath of the tax authority.

Since Modi’s tenure as Prime Minister, he has vowed to cleanse the country of black money and corruption, which accounts for as much as 20% of the country’s GDP. Gold, which India is the second largest consumer in the world, and is one of the primary means to hold unaccounted for wealth in India, is not likely to be far from Modi’s crosshairs.

With the recent spike in demand for Bitcoin in India causing massive disparity in price between Indian exchanges and more mature exchanges in other parts of the world, there is no doubt that the people of India are considering Bitcoin as an alternative means to hold unaccounted wealth outside the reach of Modi’s campaign. If Modi does in fact enact a ban on the imports of gold, which seems an increasing possibility, the demand for Bitcoin could increase dramatically beyond what we are already seeing for the country.

Consider the volume chart below courtesy of coin dance, which shows that since Modi’s initial announcement to demonetize the 500 and 1000 Rupee notes, Bitcoin volume in Rupees on https://localbitcoins.com/ has increased dramatically.

Week

Volume (INR)

11/12/2016

11,192,335

11/19/2016

16,242,585

11/26/2016

27,670,106

Between the week of Modi’s announcement 11/12 and the week of 11/26, volume on localbitcoins has increased a staggering 147%. Additionally, as reported on CoinDesk, Unocoin, one of India’s most popular Bitcoin exchanges has just released a mobile wallet for iOS and Android. This is incredibly important in unlocking the ability for a potential mass adoption of Bitcoin in India as statistics show that as of January 2016, that of the 375 million internet users in India, 303 million or 81% were mobile internet users.

Considering an import of gold being a likely scenario in the near future, the massive increase in volume of Bitcoin transactions in India, and the technological advances of the Bitcoin exchanges in India; the conditions are a perfect storm to facilitate a massive increase in Bitcoin demand surpassing what we have seen from the demonetization of the 500 and 1000 Rupee notes in the preceding weeks. If this scenario plays out, an influx of buyers will flood exchanges, and demand could push the Bitcoin premium in India even higher.

This situation presents a unique opportunity for traders in countries with matured, large volume exchanges to offer Bitcoin via Indian exchanges for a premium and pocket the profit. In practice, this is not so easy, as Indian exchanges are currently only trading in INR (Rupees). This makes withdrawal from participants who do not have a bank in India difficult as they cannot withdrawal Rupees, convert to their local currency and repatriate those earnings back to their country of domicile (due to KYC documentation requirements). However, this presents a unique opportunity for those participants to pair with a partner in India who does have an Indian bank account to facilitate the withdrawal and international bank transfer. The pair of individuals would need to come to terms to split the premium gain and could repeat the process until the market corrects itself and prices stabilize. Note: an arrangement of the sort should only be conducted with a trusted party; look out for scammers.

Have a different opinion or just want to chat, feel free to contact me at wesdewayne@gmail.com via email or g-chat, or simply leave a comment below.

The price of Bitcoin is absolutely surging in India amidst demonetization of the 500 and 1000 Rupee notes as announced by the Indian Prime Minister Narenda Modi on November 8, 2016.

As of approximately 2:00pm ET November 24, 2016 the price across the three leading Bitcoin exchanges in India had an average Bitcoin buy price of 67,735.33 INR or 984.92 USD.

Exchange

Buy price (INR)

USD Equivalent

Coinsecure

66,698.00

969.84

Unocoin

68,838.00

1000.95

Btcxindia

67,670.00

983.97

Average

67,735.33

984.92

At the same time, the price across the three leading Bitcoin exchanges in the US had an average Bitcoin buy price of 735.92 USD leaving a 249 USD or 33.8% premium on Bitcoin in India.

Exchange

Buy price (USD)

Bitfinex

737.06

BTC-e

737.70

Bitstamp

732.99

Average

$735.92

So how can traders in the US profit from this arbitrage opportunity while it lasts? There are two ways which I will outline below.

Send Bitcoin from your US exchange/wallet to one of the Indian exchanges listed above and sell for Rupees. Hold rupees until the demand is satisfied, prices converge between the US exchanges and the Indian exchanges the equilibrum price is established. Exchange Rupees back to Bitcoin and withdrawal Bitcoin back to your US exchange/wallet. Note that unless you comply with KYC requirements, you can currently only do this method on the Coinsecure exchange to the best of my knowledge. It should also be noted that holding money on exchanges is extremely risky considering how vulnerable we have seen exchanges are to theft from hackers. As this method requires holding Rupees on the exchange until the price converges back to equilibrium, it widens your exposure to the risk of the exchange being hacked and losing your funds.

If you have a bank account and proof of address in India, you can comply with KYC requirements on the Indian Bitcoin exchange. This will allow you to withdrawal your Rupees to your Indian bank account, exchange to USD and transmit back to your US bank account. This method follows the same protocol as 1. above, with the distinct difference of exchanging your Rupees to USD and taking the 33.8% (current) gain immediately as opposed to holding Rupees and waiting for the prices to converge before exchanging back to Bitcoin. Note, you will incur exchange fees from your bank that will eat into your profits with this method. Further, this method will only be relevant to those holding both a bank account in the US and India.

If you have any questions on this strategy or just want to chat, feel free to contact me at wesdewayne@gmail.com via email or g-chat.

Foreword: In this article I will explain in plain English, the trade I executed during the night of the final votes resulting in the United Kingdom leaving the European Union. Although there were many plays that one could have made that night to make money, this post will be focused on BTC.

During the final few days leading up to the referendum, odds heavily favored that the UK would remain in the EU. Note the impact on BTC as it falls drastically until voting day (June 23). During late hours of the night on voting day, the gap closes and official votes begin to put more favor towards exit than anticipated. Note BTC begins to trade up and down through the night of the 23rd as votes are neck and neck between remain and exit.

BTCUSD

As BTC has already priced in remain sentiment, and leave rapidly becomes a possible outcome, this presents an opportunity to long BTC. Consider the two possible outcomes: 1) Remain wins out, and BTC possibly drops further, or 2) Leave wins, and money moves into BTC driving price up.

Late that night, as the votes are swaying back and forth between remain/leave, massive sells are put on the EU, with simultaneous buys on gold. The odds begin to drastically favor leave, and BTC remains largely unchanged. At this point, we buy BTC at $641.19, with the assumption that BTC will soon catch up and follow gold as investors seek safe havens.

EURUSD, 30

XAUUSD

The referendum, which resulted in an overall vote to leave the EU, as opposed to remaining an EU member, by 51.9% to 48.1%, respectively lead to a rapid devaluation of the Euro and continued run up of gold, seeing roughly a~(4%) decline in the EURO and ~10% increase in Gold overnight. Meanwhile, BTC rapidly appreciates hitting our $680 target on June 25th.

What did you guys think of this trade? What other factors were you considering? Comment below and lets discuss!

Those of us that are completely engulfed in the world of crypto-currencies have a hard time understanding why anyone in their right mind wouldn’t know what a Bitcoin is. In an incredibly short period of time, we have transformed Bitcoin from its early reputation as simply a means for drug dealers to conduct business on the deep web to a fully functional fiat alternative with new services built around it every day. We’ve even seen some of the most well known companies in the world begin accepting Bitcoin as a method of payment and offering discounts for its use. So why is it that if you ask someone if they own Bitcoin, 99% of the time they look at you like you’re an alien?

A huge problem I have seen is not enough people actually own and know how to use Bitcoin. Sure, more and more people are learning about the existence of Bitcoin, but how much does that really help us? This first time I had heard about Bitcoin was back in 2011, but I never actually bought any until 2013 when one of my coworkers bought some. Feeling envious and seeing how excited my friend was about it, I bought Bitcoin a few days later. A few months after that, ALL my friends owned Bitcoin. So what was the tipping point? You see, they all knew about Bitcoin, had heard about it in the SilkRoad case etcetera, but they never really cared about it until they owned it. Ownership is the differentiator that will help us accelerate the widespread usage of Bitcoin beyond our wildest dreams.

But how do we do it? How can we get Bitcoin in the hands of the many? Easy: we make it so freaking simple your boss who still types with his two index fingers can do it.

My good friends over at http://desantisjohnson.com have created the easiest guide to acquiring Bitcoin I’ve ever seen, check it out in the link below.

I encourage you to take a moment and spread the word to your noobish friends and family, and get them started with Bitcoin. You can smile in a few years when they are proclaiming you their modern day messiah.

Bitcoin is evolving rapidly, and so are the regulations. Regulators are still far behind in the race to understand and govern the use of Bitcoin and Bitcoin related businesses, however their wrath can and will have a profound effect on those who are not ready for it.

Most entrepreneurs in the Bitcoin community are individuals with a strong background in programming and web development. They have the knowledge and skills at their disposal to create revolutionary new services and systems, but lack the legal-know-how to protect themselves and maintain compliance with regulators.

Others, simply live under the false pretense that the laws do not apply to them or just don’t care.

A prime example of why maintaining compliance with regulators is so important cannot be seen clearer than the case of my friend Charlie Shrem, former CEO of BitInstant and founding member of the Bitcoin Foundation.

Charlie, a young and wildly successful Bitcoin Entreprenuer is facing possible jail time and is poised to give up 950,000 USD in a plea bargain with the US Government for which he plead guilty to aiding and abetting an unlicensed money-transmitting business on 4th Sept via Coindesk.

Charlie’s story proves that regulators taking Bitcoin seriously and are cracking down on Bitcoin businesses.

So what can you do to manage regulatory risk? My suggestion is to contact a professional consulting company, well known in the Bitcoin community. Personally, I have worked with several companies who offer services to protect Bitcoin businesses and protect them in this rapidly changing regulatory environment. Of all the companies I’ve worked with, my friends over at Aspen Assurance have proven to be reliable, knowledgeable and effective. They have worked with some of the biggest names in the industry, but also don’t shy away from smaller start-ups who are serious about staying ahead of the game.

All-in-all, managing your risk is a tough and swiftly evolving mission, but one that should be taken seriously by all those involved in Bitcoin related businesses.